Disclosed is a method and system for dynamically tracing a value realized by an Information Technology (IT) service. The method may comprise generating a correlation matrix representing relationship between a plurality of dimensions associated with an IT service, wherein the correlation matrix is generated in form of a plurality of quadrants, wherein each quadrant represent the relationship between at least two dimensions. The method may further comprise capturing a hierarchy of parameters associated with the dimensions, wherein at least one parameter, in the hierarchy, is contextually related and dependent upon at least one other parameter. Further, the method may comprise computing a relative value realization index (rVRI) using the hierarchy of parameters, wherein the relative value realization index is indicative of value realized, by the IT service, with respect to the dimensions. Furthermore, the method may comprise generating a traceability matrix indicating correlation between the relative value realization index and the hierarchy of parameters. Further, the method may comprise tracing, using the traceability matrix, variation in the relative value realization index based upon dynamic variation of one or more parameters.